Kotak Mahindra Bank, Axis Bank, IndusInd: Private bank stocks surge up to 4% on credit growth, FCNR boost; Q2 earnings in focus

Private bank stocks like Kotak Mahindra Bank, Axis Bank, IndusInd Bank, HDFC Bank, Bandhan Bank, among several others, surged after the opening bell on Tuesday, October 6, due to the healthy business performance in the July to September quarter (Q2) of the financial year 2026-27.

Equity market investors focused on the latest Q2 business update, as banks reported strong credit growth and FCNR support ahead of the quarterly results, in turn increasing expectations for the upcoming earnings reports scheduled later this month.

NSE data showed that the sectoral benchmark Nifty Private Bank index jumped 1.17% to hit an intraday high of 27,033.15 points on Tuesday’s market, in comparison to 26,718.15 points at the previous equity market close.

Experts predict that the deposit growth, along with the overall loan book advancement, is expected to power the upcoming financial earnings at a time when cyclical headwinds seem to be largely behind.

In line with the private banking stocks, the overall Nifty Bank index also gained during Tuesday’s morning market hours as investors reacted to the overall growth potential for the banking sector.

The Nifty Bank index gained 0.65% to hit an early market high of 55,074.45 points on October 6, in comparison to 54,714.10 points at the previous equity market close, according to NSE data.

Investors were also looking ahead towards Reserve Bank of India's upcoming monetary policy outcome this week amid the rising US treasury yields and elevated crude oil prices in the market, strengthening the potential for a policy tightening in the Indian economy.

Private bank stocks today

Kotak Mahindra Bank

Latest data release showed that Kotak Mahindra Bank’s net advances surged 24.7% year-on-year (YoY) to ₹5,77,094 crore, in comparison to ₹4,62,688 crore in the same period a year earlier.

While the private bank’s CASA (current account savings account) deposits surged 11.3% YoY as of the period under review to ₹2,49,105 crore, from ₹2,23,791 crore in the same period a year earlier.

The data showed that the total deposits of the bank surged 23.2% YoY to ₹6,51,491 crore in the September quarter. Kotak Mahindra Bank’s FCNR(B) deposits aggregated to $5.78 billion or ₹55,344 crore due to RBI’s India's swap facility for FCNR(B) deposits.

“Delivered a marked step-up in balance sheet momentum in 2QFY27, with FCNR(B) deposit mobilisation lending additional thrust to an already robust sequential accretion,” said Citibank analysts, highlighting that the bank’s gross advances exceeded their expectations.

In line with the performance review, Goldman Sachs analysts said that they expect the Q2 earnings to be stronger-than-expected due to the performance driven by FCNR flow mobilisation and the organic loan growth.

“Have better clarity on leadership, strong liquidity position at the bottom of the rate cycle, potential acceleration in loan growth led by unsecured loans amid cheap valuations. Profitability is strong, and as earnings inflect,” said Goldman Sachs experts.

IndusInd Bank

Q2 business snapshot showed that IndusInd Bank’s net advances or loans recorded 11.2% YoY growth to ₹3,62,393 crore in the period under review, from ₹3,25,881 crore in the same period a year earlier.

Overall bank deposits also gained 10.1% to ₹4,29,038 crore in Q2, from ₹3,89,600 crore in the same period a year ago. While the bank’s CASA ratio was at 30.7% in the September quarter.

“The Bank mobilised FCNR (B) deposits aggregating to $3.51 billion (₹33,627 crore),” as per the NSE filing.

Experts from Goldman Sachs said that they expect IndusInd’s loan growth to pick up, with the institutional lender potentially entering a multi-year recovery phase with the asset quality stress largely behind.

“IndusInd Bank is entering a multi-year recovery phase. Valuations already discount much of the recovery,” said the analysts.

Axis Bank

Axis Bank’s gross advances surged 22.7% YoY to ₹13,84,600 crore as of the September quarter, from ₹11,28,400 crore in advances in the same quarter of the previous financial year, as per the exchange data.

The institutional lender’s total deposits surged 20.7% YoY to ₹14,52,100 crore in the period under review, compared with ₹12,03,500 crore in the same quarter of the previous year.

The bank also disclosed that it mobilised FCNR (B) deposits aggregating to around $10.62 billion (₹1,01,800 crore) as on September 30, 2026.

Experts from Goldman Sachs predict that the cyclical headwinds for Axis Bank are now largely behind, and the underlying margins should recover from FY28 onwards due to the favourable mix shift towards the retail or SME segment.

Looking ahead, Citibank analysts also said that the traction in retail disbursements should lend momentum to retail growth, while Mid-corporate/SME/SBB segments are poised to sustain their robust trajectory.

HDFC Bank

Earlier this week, HDFC Bank disclosed that the average deposits were ₹31,66,500 crore for the September 2026 quarter, marking a growth of around 16.8% over ₹27,10,500 crore for the same period a year earlier.

“The Bank’s period-end deposits were approximately ₹33,27,500 crore as of September 30, 2026, a growth of around 18.8% over ₹28,01,800 crore as of September 30, 2025,” as per the exchange filing.

Due to RBI’s swap facility for FCNR(B) deposits, HDFC Bank mobilised foreign currency deposits aggregating to around $11.5 billion (₹11,03,400 crore).

Bernstein analysts said that they expect the few upcoming quarters to be without any major kitchen-sinking exercise, coupled with greater stability in the top management team, could help alleviate the governance concerns.

“Beyond the CEO transition, there are several other factors that could go right for the bank,” said Bernstein analysts.

RBL Bank

Experts predict that RBL Bank recorded strong loan growth led by wholesale and loans against FCNR-B deposits, as Goldman Sachs analysts predict the pace of underlying profitability to witness gradual improvement.

"At a current valuation, see a more favorable risk-reward ratio at peer private banks," said Goldman Sachs experts.

IDFC First Bank

Experts predict that IDFC First Bank is expected to record strong growth delivery, with high-cost deposit run-down positive in the Q2 results.

Loans and advances witnessed a 20.4% YoY growth to ₹3,13,864 crore in the period under review, from ₹2,60,690 crore in the same period a year earlier. Total deposits grew 17% YoY to ₹3,23,697 crore, from ₹2,76,771 crore in the same period.

“Asset quality trends remained healthy during the quarter,” said Goldman Sachs experts.